7 February 20 - National Stock Exchange of India · The presentation is also being hosted on the...

7 February 2020

The Manager, Listing BSE Limited Phiroze Jeejeebhoy Towers, Dalal Street, MUMBAI - 400 001

The Manager, Listing National Stock Exchange of India Ltd Exchange Plaza, Plot No. c/1, G-Block, Bandra-Kurla Complex, MUMBAI – 400 051

Dear Sirs,

Sub: Presentation for Investor(s)/Analyst(s) call

Please find enclosed a copy of the presentation proposed to be made at the Investor/ Analyst call to be held today at 11:00 am in connection with the results of the Company for the quarter and nine month period ended 31 December 2019. The presentation is also being hosted on the website of the Company at www.mphasis.com. We request you to kindly take the above on record as required under the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Yours faithfully, For Mphasis Limited

Subramanian Narayan Vice President and Company Secretary Encl: As above

DocuSign Envelope ID: 91BD7CF4-99B9-4E04-99BD-19337BBD257E

http://www.mphasis.com/

© Mphasis 2019 Proprietary and confidential information

Safe Harbor

2/6/2020 1

Certain statements mentioned in this presentation concerning our future growth prospects are forward-looking

statements regarding our future business expectations and are based on reasonable expectations of the

management, which involves a number of risks, and uncertainties that could cause actual results to differ

materially from those in such forward-looking statements. The risks and uncertainties relating to these statements

include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits,

our ability to generate and manage growth, intense competition in IT services, wage increases in India, our ability

to attract and retain highly skilled professionals, our ability to manage our international operations, reduced

demand for technology in our key focus areas, withdrawal of fiscal governmental incentives, political instability,

war, legal restrictions on raising capital or acquiring companies, and general economic conditions affecting our

business and industry. We may, from time to time, make additional written and oral forward-looking statements.

We do not undertake to update any forward-looking statements that may be made from time to time by us or on

our behalf, unless required under the law.


Investor Presentation

Q3 2020

2



There are many forces changing customer priorities

External forces have an impact on customer needs, economics, and decision making. What emerges are new customer priorities.

2/6/2020 3



Enterprises are missing the mark…

Source: Customer Expectations Hit All-Time Highs – Salesforce Research

2/6/2020 4


https://www.salesforce.com/research/customer-expectations/


Mphasis Value Migration

Cost Takeout

Self Funding Transformation

Agility with Resilience

Huge Impact on IT Consumption

Customer Centricity

Customers Driving Disruption

Customer Drivers

Next Labs

Value Migration

2/6/2020 5



Our Numbers tell the Story: Consistency and Transformation

8/16/ 2019 6

320

270

280

300

220

290

310

230

250

260

240

20

200

210

Q3’19

235

Q4’15

Q3’17

Q2’19

Q1’14*

Q1’17

Q1’20

Q2’20

Q2’17

Q4’16

Q4’19

Q3’20

Q3’16

Q1’19

Q2’16

224

Q1’16

Q3’15

256

292

250

240

Q2’15

228

Q1’15

237

Q4’13

229225

231

Q3’18

242252

283

264269

276

224

297

260

305

318

Q4’18

Q2’18

Q1’18

227 225222

Q4’17

-4.9%

+14.1%

Overall Gross Revenue in USD $M at average USD/INR rate for the respective quarters

* Transition Year 5 months adj.

CAGR

CAGR

CQGR +3.3%



Continued growth in Focus Areas

2/6/2020 7

120 124 145

32 343636 4850

6377

88

Insurance

Q3’19Q3’18 Q3’20

Emerging Industries

252

ITCE

BCM

318

283

5%

17%

18%

CAGR

10%

29.7%

13.1%

7.7%

25.0%

24.5%

Wealth Management & Brokerage

Corporate Banking

Consumer Banking

Investment Banking

Mortgage

BCM Vertical Split

Emerging Vertical Split

50.6%

18.1%

14.3%

17.0%

Logistics &Transportation

Others

Healthcare &Pharma

Manufacturing

7%

5%

13%

Q3 Y-o-Y

16%

Revenue in USD $M at average USD/INR rate for the respective quarters

Strongest growth in Europe in the past five years



Direct Core Business has been consistently delivering strong growth

8

Revenue reported is in USD @ Avg USD INR Ex. Rates

Consistency: Growth across the Board

• Above market growth in Strategic Accounts in YTD FY-20

• >80% of deals won came from new gen areas in FY’19 and YTD FY20

• YTD FY20 New Clients grew > 80% YoY and Blackstone accounts grew > 50% YoY

• YTD TCV wins of $514M

119

Q1’18Q4’17 Q2’20Q2’18 Q1’20

119

Q4’19Q3’18 Q1’19Q1’17 Q2’17 Q3’17 Q4’18 Q2’19 Q3’19 Q3’20

120 121127

133138 142 146

151160

166 170175

18315.6% YoY growth in YTD FY20 CQGR

16.0%CAGR

3.8%

Q2’19Q3’18Q1’18 Q2’18 Q4’18 Q1’19 Q3’19 Q4’19 Q1’20 Q2’20 Q3’20

+131%

New Client wins have fueled growth in Direct

12191857443 77 13Clients added



DXC Relationship Transformation

2/6/2020 9

Q2-16Q1-16 Q3-16 Q4-16 Q3-19Q4-17 Q2-18Q1-17 Q1-19Q2-17 Q3-17 Q1-18 Q3-18 Q4-18 Q4-19Q2-19 Q1-20 Q2-20 Q3-20

-11.9%

17.7%

Revenue Trend over last 19 qtrs. in $ Mn

Business Shift Geographical Penetration

Q4’17

18%

58%100%

Q4’18

35%

7%

Outsourcing

58%

24%

Q3’20

App Services GTM /Solution Partner

Service Transformation9%

91%

Q4’18

13%

Americas

Q4’17

70%87%

30%

Q3’20

RoW –Europe / UKI,APAC

CAGR

CAGR



112 115 109 131 138

FY15 FY16 FY17 FY18 FY19

Strong Earnings Growth and Cash Generation

2/6/2020 10

Improving operating margin

13.3% 12.8%14.6%

15.1%16.1%

FY15 FY16 FY17 FY18 FY19

Free cash flow ($ million)

Consistent free cash flow generation

110

YTD FY20

15.5%-17%

FY20 G

* FY20 G – FY20 Guidance



Strong Operating profit growth driving EPS growth

2/6/2020 11

Operating profit growth higher than revenue growth rate…

Q4’19Q1’19Q4’17Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q3’16 Q4’16 Q1’17 Q3’17 Q1’18 Q2’18 Q3’18 Q4’18 Q2’19 Q3’19 Q1’20 Q2’20 Q3’20Q2’17

20.7%

14.4

Q2’19

8.5

Q3’16

8.8

Q1’18Q1’15 Q2’15 Q3’15 Q4’15 Q1’16 Q2’16 Q4’18Q4’16 Q1’17 Q2’17 Q3’17 Q4’17 Q2’18 Q3’18 Q1’19 Q3’19 Q4’19 Q1’20

9.1

12.3

7.4

14.0

8.38.8

7.4

15.8

7.6 7.7

11.1

8.3

13.414.3

Q3’20

9.510.29.9

14.2 14.7

Q2’20

9.6

23.8%

… Resulting in strong EPS growth

CAGR

CAGR

Growth in Reported operating profit (INR Mn)

* CAGR: Quarterly operating profit/EPS growth annualized



Core Investment Thesis : YTD FY20 Execution Update

2/6/2020 12

1. Accelerate Direct Core : Consistently outgrow the market• Farming Strategic Accounts• New Client Acquisition (NCA)• Continue momentum in BX channel

2. Strategic Partnership with DXC/HP : Continuous transformation in relationship• Applications Partnership Growth• Expand Vertical and Geographic Footprint• Increase Service Transformation Participation

3. Continued focus on Margin optimization to fuel Growth (EBIT 15.5%-17%)

4. Investment Capability building

5. Strong Cash flow Generation and Optimal Cash Strategy to maximize shareholder value

Strong growth of 16.2% YoY in CC;

NCA grew 80+ % and BX grew 50+ %

Continued momentum in Deal wins: YTD TCV wins of $514M; New-Gen Services at 82%

Consistent sequential growth since Q4’17; YoY CC growth rate of 9.4%

Solutions Partner: 58% revenue from Service transformation in Q3’20

Strong Free cash flow generation of $110M in YTD FY20, Cash balance of $301M

FY20 Margin guidance at 15.5% to 17.0%

Continued progress in implementation of IP based platform, Delivery Transformation, Next Labs and Talent Next Programs



Industry Analysts are recognizing our strengths in focus areas

2/6/2020 13

Based on 60+ mentions by Analyst firms in there research over the last 15 months

G A R T N E RMAGIC QUADRANTNICHE PLAYER 2019

Life Insurance PolicyAdministration System

Midsize Digital Experience Agencies

FORRESTERWAVE CONTENDER 2018

Special API Strategy and Delivery

FORRESTERWAVE CONTENDER 2018

Ranked #6 in BFS, #2 on VoC, 2019



About MphasisMphasis (BSE: 526299; NSE: MPHASIS) applies next-generation technology to help enterprises transform businesses globally. Customer centricity is foundational to Mphasis and isreflected in the Mphasis’ Front2Back™ Transformation approach. Front2Back™ uses the exponential power of cloud and cognitive to provide hyper-personalized (C=X2C2

TM=1) digitalexperience to clients and their end customers. Mphasis’ Service Transformation approach helps ‘shrink the core’ through the application of digital technologies across legacyenvironments within an enterprise, enabling businesses to stay ahead in a changing world. Mphasis’ core reference architectures and tools, speed and innovation with domainexpertise and specialization are key to building strong relationships with marquee clients. Click here to know

Important Confidentiality Notice

This document is the property of, and is proprietary to Mphasis, and identified as “Confidential”. Those parties to whom it is distributed shall exercise the same degree of custody andcare afforded their own such information. It is not to be disclosed, in whole or in part to any third parties, without the express written authorization of Mphasis. It is not to beduplicated or used, in whole or in part, for any purpose other than the evaluation of, and response to, Mphasis’ proposal or bid, or the performance and execution of a contractawarded to Mphasis. This document will be returned to Mphasis upon request.



https://www.mphasis.com/home/our-approach.html

https://www.mphasis.com/home/our-approach.html


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